Private Finance

Private Finance accounts for a significant amount of Government expenditure.  The major use of private finance is in Education, Health, Transport and Defence.  It is used for a variety of projects including buildings such as schools, hospitals, accommodation, and transport infrastructure such as roads. It is also used to provide defence equipment and defence training facilities.

The capital value of upcoming current Private Finance Initiative (PFI) deals is expected to be £13 billion, while the number of operational deals is greater; there are around 600 operational deals listed on the Treasury's website with a capital value of over £50 billion and future payments of over £150 billion. The Government’s wider use of Public Private Partnerships (PPPs) includes large complex deals, like Crossrail and the London Underground, as well as smaller joint ventures on a local level, such as Local Asset Backed Vehicles in the housing sector.

Since 1997 the National Audit Office (NAO) has produced over 80 reports on the value for money of various Private Finance activities including PFI and PPPs, privatisations, asset sales and acquisitions.  The reports include studies on individual deals and programmes and thematic issues such as operational performance, financing, the tendering process and benchmarking.  As well as reports, the Practice disseminates good practice through its events, including the annual Private Finance conference, workshops and regular meetings with stakeholders.  It also provides Secretariat for the International Organisation of Supreme Audit Institutions (INTOSAI) privatisation, economic regulation and PPP Working Group.

The recommendations set out in these reports have been summarised and can be accessed at the NAO Private Finance recommendations database in the Private Finance Practice Network section.

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